FOREX-Oil price rise underpins Canadian dollar, greenback steady

Reuters Staff

2 Min Read

* Canadian dollar supported in wake of rise in oil prices

* U.S. dollar steady vs basket of six major currencies

By Masayuki Kitano

SINGAPORE, Dec 27 (Reuters) - The dollar held steady versus a basket of major currencies on Wednesday, while the Canadian currency traded near a three-week peak, drawing support after oil prices climbed to 2-1/2 year highs.

The dollar index, which measures the greenback against a basket of six major rivals, was little changed at 93.300.

The Canadian dollar last stood at C$1.2694 per U.S. dollar, near Tuesday’s peak of C$1.2684, which was the loonie’s highest level since Dec. 6.

Oil prices surged to 2-1/2 year highs on Tuesday, boosted by news of an explosion on a Libyan crude pipeline as well as voluntary OPEC-led supply cuts.

Commodity-linked currencies such as the Canadian dollar are likely to gain support on the crude rally, although it remains unclear whether there will be a sustained rise in oil prices, said Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore.

With many market participants on holiday ahead of the year-end, currency moves could be exaggerated by thin trading conditions, Innes added.

Moves among major currencies were modest with the U.S. dollar edging up 0.1 percent to 113.31 yen, while the euro was little changed at $1.1860.

Bitcoin edged up 0.9 percent to about $15,900 on the Luxembourg-based Bitstamp exchange. That came after bitcoin bounced on Tuesday after sliding 25 percent last week, its biggest weekly drop since 2013. (Reporting by Masayuki Kitano; Editing by Sam Holmes)